Lead vendor tells oversight committee that MNsure took control of project last February

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The lead vendor contracted to build Minnesota’s struggling health insurance exchange says it was stripped of much of its job by MNsure officials beginning last February, according to a report for the Legislature’s oversight committee.

“While MAXIMUS initially played a Project Management role, this was assumed by MNSure in February 2013 with MAXIMUS performing a supporting function,” according to Leslie Wolfe, division president of Maximus’ Health Services Central.

“Additionally, MNSure assumed responsibility for defining how the Exchange would function, how the individual vendor solutions would come together to produce the customer experience, and how the Exchange would provide operational business intelligence and reporting,” she wrote.

The report, obtained by MinnPost, raises significant questions and differs with Gov. Mark Dayton and MNsure officials’ view of who is to blame for many of the health exchange’s start-up problems.

MNsure Board Chairman Brian Beutner, who had just been appointed when the contract change was signed in May, said on Wednesday that Maximus’ role was shifted to developing the exchange technology with other subcontractors, rather than overseeing the entire project.

It remains unclear why MNsure appears to have almost completely cut ties with the vendor. Beutner and MNsure Interim CEO Scott Leitz weren’t involved in the exchange when the decision was made.

Rep. Joe Atkins and Sen. Tony Lourey, who co-chair the MNsure Oversight Committee, were not immediately available for comment. Atkins last week requested the account of how Maximus’ contract had changed.

The Maximus report also sheds new light on the MNsure governing board’s discussion of potentially considering other technology vendors to fix the exchange’s malfunctioning technology and Gov. Mark Dayton’s criticisms of the exchange.

MNsure initially downplayed the change to Maximus’ contract for managing the construction of Minnesota’s state-based exchange, and the firm’s account implies the state should shoulder more of the blame for its rollout.

“My understanding is that the change that was made with regards to the Maximus contract was really intended to move Maximus into a role that was more appropriate for their skill set and what they were able to do,” Leitz said. “I think the state at that time — my understanding is — assumed more of a day-to-day management of the oversight aspects of it.”

According to Wolfe, MNsure took over and changed its approach to getting the exchange completed before Oct. 1.

“In February of 2013, MNsure determined that it wanted to direct the development of the Exchange,” Wolfe wrote.

Former MNsure Executive Director April Todd-Malmlov made a similar statement to staff in an email that month. The shift, Wolfe wrote, “had effectively begun” after Feb. 1, around the time exchange staff traveled to Washington, D.C., for a meeting for states building their own exchanges.

“MNsure assumed responsibility for defining how the exchange would function, how the individual vendor solutions would come together to produce the customer experience, and how the exchange would provide operational business intelligence and reporting,” she wrote.

The document lists nearly every single responsibility that Maximus had at the beginning of the contract as transferred over to the state.

In doing so, it changed work and development “from Maximus’ recommended approach” and divided the build-out among the subcontractors who had been designing the nuts and bolts of the technology.

“MNsure took the work product developed under Maximus’ direction and rather than gathering the remaining requirements from the state stakeholders based on an end-to-end view of the exchange business processes, MNsure directed that IBM Curam, Connecture and EngagePoint gather requirements based on their individual functional responsibilities,” Wolfe wrote.

Maximus, she said, then began to “assist MNsure with administrative responsibility, including contract administration and managing the contract amendment process or other required changes.”

At one point, Maximus had 20 to 25 staff working on the project and about 10 to 15 onsite.

“From May 2013 until November 30, 2013, the Maximus team was reduced to one project manager who was assigned to assist as directed by MNsure,” Wolfe wrote. “After November 30, 2013, Maximus has assisted in contract administration only and does so remotely from the project site.”

Minnesota Management and Budget was charged with overseeing the exchange at the time the decision was made. The agency didn’t immediately respond to requests for comment.

Todd-Malmlov, who left the exchange amid its technical failings last month, has not been available for answers since her resignation.

Maximus referred MinnPost back to the exchange when the contract issue came to light.

“I would feel confident saying it appears from the letter that Maximus was set aside, but what we don’t know [is] who negotiated that, what decisions were made?” Sen. Michelle Benson, who received the letter Wednesday, said in an interview.

“It feeds into this culture of secrecy and kind of keeping things from everyone instead of being transparent and forthright.”

A state watchdog will soon audit MNsure as a requirement of state and federal law. But the office will likely take a much broader look at the exchange’s leadership and contracts because of the botched rollout, Legislative Auditor Jim Nobles has said.

The exchange also will get a full system review from Optum, a subsidiary of UnitedHealth Group. Results from that review should be available next week, and Leitz and Beutner said the review would shed light on whether removing Maximus from the exchange project was a good idea.

“From our perspective, the key thing moving forward is getting some really good recommendations on how we actually do lead this project end-to-end moving forward,” Leitz said.

It’s also important to note that the letter is only one side of the account.

“There might be truth there, but there might also be deflection,” Benson said.

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“The exchange also will get a [free] full system review from Optum, a subsidiary of UnitedHealth Group.” We should hope for an expert review, if not an entirely impartial one.

In the October 24th Congressional review of the ACA debacle, Andrew Slavitt, executive vice-president of Optum/QSSI, began his testimony by noting that QSSI was hired to build the data services hub, “a pipeline.”

In November the MNsure chief resigned. April Todd-Malmlov was also former Director of Competitive Intelligence for UnitedHealthcare and the Vice President of Strategic Analysis and Communications for Government Affairs at UnitedHealth Group, former Exchange Director Minnesota Dept. of Commerce, and now former Executive Director MNsure.

What’s going to happen if the auditor discovers that MNsure’s management has been lying to us all along and $130 million of taxpayer money has been thrown down a rat hole? What about the blatant violations of HIPPA by playing fast and loose with people’s personal information?

Is fraud too strong a word? Could people face charges for defrauding the taxpayers or do they just get relieved of their current duties and told not to do it again? Seriously.

The finger pointing has begun and it will continue. No one knows yet exactly who is at fault and for what. There will be a paper trail (status report, issue logs, project correspondence) but it will take a while to sort out. In the meantime, the political hacks will make hay and find out later if they are right.

Had the rollout been a success, these same folks (MnSure staff and Maximus) who are disclaiming responsibility would be touting their role in the success.

A couple of things you can bet on: There is no single entity at fault and there is no single cause for the failure.